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Don’t Forget: Travel Prices Usually Fall in September

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If your travel plans are flexible, you could save a good chunk of cash by avoiding peak season.

Senior woman leaning on table, man sitting on chair and using computer, planning holiday together

After years of shifting plans and making compromises, many travelers are finally ready to go on a real vacation this summer. But here’s the catch: Prices are skyrocketing as pent-up demand crashes into limited availability.

According to data from the U.S. Bureau of Labor Statistics, average airfare was up 33% in April compared with 2021 and prices seem to only be accelerating.

Airfare now exceeds pre-pandemic prices chart by nerdwallet

While airfare and hotel prices are higher now than they were during most of the pandemic, they’re nothing compared with rental car prices, which have remained elevated since last summer. Prices for car rentals were up an astonishing 70% in April compared with pre-pandemic rates in April 2019, according to the BLS. Airfare prices have had their own share of jumps. Though lower than pre-pandemic levels for the majority of the past two years, airfares have risen significantly in the last two months.

Anyone who has searched for summer travel doesn’t need to dig very deep into the data to know it’s expensive. When we looked in May, a Google Flights search for round-trip airfare from Los Angeles to Rome showed only a single date below $1,000 in June and July.

So, what’s a budget-conscious traveler to do?

Wait an extra month or two, if you can

If travel during the summer looks like it might break your budget, consider bumping your vacation out by a month or more.

“Airfare in September and October typically drops compared to peak summer months,” Hayley Berg, lead economist at Hopper, a travel booking platform, said by email.

Berg cites students’ return to school as a key reason for this drop-off in demand, which points to an important caveat: Traveling during off-peak seasons only works for those with schedules flexible enough to take advantage of the cost savings.

Yet even by mid-to-late August, prices tend to drop from their July heights.

“Though prices have risen across all weekends this summer compared to 2019, fares have risen the least for August,” Berg said.

And indeed, when we searched in May, most round-trip fares from Los Angeles to Rome dropped below $1,000 in August and September.

Track prices, they may cool down

Prices bumping higher during the summer is one thing, but this year travel costs are also running into unprecedented demand, constrained supply and rampant global inflation.

Jet fuel prices were higher at the end of April than they have been in over 30 years, according to the U.S. Energy Information Administration. Since the effects of high fuel prices are usually not reflected immediately in airfare, summer flight costs could rise even more by the time you read this.

Yes, prices could keep increasing through the summer, making $1,000 tickets to Italy look like a decent deal. But, more likely, they will cool in late summer and early fall as this unique combination of factors returns to something resembling normal.

Leverage the strong dollar, choose locations wisely

One bright spot in the dismal travel landscape: The U.S. dollar is currently strong against many foreign currencies. For example, one dollar is worth 0.94 euros as of this writing, up from 0.82 euros in May 2021. That might not seem like much, but it has ripple effects on every aspect of a travel budget, from hotel rooms to train tickets to food.

But be careful: This effect isn’t uniform. For example, the dollar is actually weaker against the Mexican peso than it was at the start of the pandemic. And although the dollar is especially strong against the Japanese yen, travel to Japan (and many other countries) remains highly restricted.

If you’re looking to travel this summer

Everyone wants to travel this summer, which is part of the reason why prices are skyrocketing. Remember: Prices usually drop considerably in August and through the early fall. So if you can defer your vacation by a month or two, you might be able to salvage it while remaining within your budget.

There’s no guarantee that prices will behave themselves this year, but historical trends and the unwinding of long-stifled travel demand could mean more reasonable prices this fall.

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